Part III
In England the parallel (dis the US $) campaign was frank and brutal. As the BoFrance took gold from NY, rumors of an imminent financial collapse in the US spread from Paris throughout Europe as the French papers kept reminding folks how solid the gold backed French franc was.
Then came the news that President Hoover had called upon American bankers to MOBILIZE (<--- exact quote, folks. Anyone ever heard the word mobilize in reference to gold recently?????!) mobilize the credit resources of the American banking system against the tide of liquidation that was running in New York.
Instantly, upon the raw news, without waiting for details, the leaders of current opinion in France pronounced a sensational judgement. The US, they said, had entered the path to inflation. This was the beginning of the end of the gold backing of the dollar. Would the people of the world NOW believe them when they claimed the French Franc was the good gold money of the world?????
At this precise time of negative spin and 3" high French and Gr. Brit headlines advising of the tenuous status of the US $, the premier of France decided he HAD to pay a visit to the US, to examine the problems of the world and explore all solutions.
What did he really come to get in behalf of France? Besides our gold?
1) to have US forgive France her war debts. All of them.
2) US to save the "Young Plan"--the dead and presumed buried--plan where France was in premier position of being paid by Germany for all the war wrongs before England or America received any of their German reparations.
3) to have Hoover stick to his 1 year war debt moratorium, not extend it.
While same premier was on the high seas high-tailing it for Hoover's White House, the NY banking community and all of the US citizens were stunned by the news that:
The Bank of France had served AN ULTIMATUM on the American banking system!
She would NOT leave her credit balances in NY any longer unless we paid her more than 1«% she was currently getting. If we didn't comply, she'd yank her credit balances, all $600 MIL of them. Remember the business checking account illustration in Part I?
Besides tourist dollars spent in France that were on the kept on French books as gold credits, the balance of the $600 Mil was American Money loaned to Germany to pay German reparations to France!
The Germans took our gold backed monies, transferred it by means of ledger entries to France ON AMERICAN BANKS' BOOKS, and the French left it here to earn that measly 1«% interest.
However, France knows she can only do this because her payments to the US Treasury have been suspended courtesy of benevolent Uncle Hoover, for one year.
The French franc assuredly would be the premier gold money and govern the world of finance if she could force us off the gold standard.
What did Wall Street do? What did Hoover decide? Will we ever hear from the French premier again?
END OF EXCERPTS.
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COMMENTARY:
Yes, there is more.
And yes, there is an EU. It traded on Globex this very evening, in point of fact.
I repeat the chilling excerpt from the Warburg Director of Foreign Exchange Yorke which yanked me out of academic contemplations
and into the icy shower of global 1998 gold vs. US$ vs. EU reality:
"The whole EMU project is driven by law; the basis for any decision (ECB's gold backing of EU) must be the Maastricht Treaty."
Germany has 28.9% of the vote, (could it be they have more Au than France???)
France 21.8%
Italy 20.3%
Thus,Germany and France together have a majority and will most likely make this decision in conjunction with Italy."
At least 10% of reserves (will be in gold) which appears to be mkt consensus, but the risks are on the upside, that is to say: it is more likely to be 30% than 0% of total reserves.
Why? Because Germany, France & Italy will effectively make the decision & they have the highest proportion of Au to total reserves of any European country."
FOLLOW THE GOLD
FOLLOW THE VOTE
FOLLOW THE GOLD "MOBILIZATIONS"
FOLLOW THE DOLLAR'S DEMISE
Thank You. |
